While the direct-to-home satellite ship has long left the proverbial harbor, the Canadian contingent has its rudder down ahead of the u.s. contenders in the race to wireless distribution services.

In this convergence/competition donnybrook where broadcasters are morphing into distribution entities, cable-based companies are strategically aligning with telephone companies, and telephone companies are potentially coming through the broadcasting back door with part ownership of new wireless licensees, it’s becoming progressively difficult to decipher the rules.

All are in hot pursuit of the killer application, with two streams of wireless distribution – Multichannel Multipoint Distribution Systems (mmds) and Local Multipoint Communications Systems (lmcs) – the latest players prepped to give the established cable distribution cartel a run for subscribers.

mmds is a digital wireless cable system capable of providing subscribers 100-plus channels worth of high-quality MPEG 1 and MPEG 2 compressed video and audio content. Data is broadcast from existing transmission towers equipped to broadcast digital microwave signals and received with a set-top box and a small antenna. A two-way system, mmds also allows services like Internet access and video on demand.

The lmcs prototype delivers two-way digital video signals along with voice and data access without wires using very high frequency of the radio spectrum. In its simplest terms, lmcs will have all the abilities of the cable system (a 100-plus extended channel capacity, with the caveat that crtc-sanctioned broadcast licences are required so networks aren’t a planned part of the original service offerings) and the interactive capabilities of the telephone.

Through lmcs, video on demand and Internet access will be available to the subscriber at speeds that make today’s tech look snail-like by comparison. The frequency band consists of six spectrum blocks of 500 mhz each.

At the receiving end, consumers will use a small antenna, with signals delivered via antennas from microwave base stations with a range of five kilometers.

As a point of reference, lmcs operates in a higher frequency system, in the 28 ghz range; mmds operates in the 2.5 ghz range. (Cable services are under 1 ghz and present-day dth services are at 12 ghz.) lmcs signals are broadcast up to five kilometers from transmission sites versus a 50-kilometer radius for mds broadcasts.

Whereas the u.s. won’t issue its first pack of wireless cable licences until early next year, the Ministry of Industry in Canada doled out three 1 ghz lmcs licences this fall – two national and one Ontario regional – all of which are blueskying rollout in 1997.

In the meantime, the first new system out of the gate has been an mmds system launched by Winnipeg-based SkyCable, the baby of that city’s Craig Broadcasting, which hit the air in October of this year after being licensed in December 1995. Two Ontario competitors await a crtc licensing decision, expected in the next few months, to bring an mmds service to Toronto and the Golden Horsesh’e. The initial salvos of these broadcasters have been aimed at the un- and underserved in the cable hinterlands.

Besides picture and sound quality, mmds is touted by its proponents as an interactive, addressable service offering package flexibility and access to local programming and construction of infrastructure with readily available technology at a lower cost than dth satellite services or cable. Signals maintain integrity within the transmission area and are not susceptible to snow or fadeout over distance.

The competitors for Ontario’s first mmds system thus far are Toronto-based SelectView and Toronto-based PowerTel TV, which is backed by Simmonds Capital. Both services are offering upwards of 100 channels of tv, flexible packaging and, ultimately, Internet access.

PowerTel president and ceo Ted Boyle, former head of ExpressVu, says the service will have the capacity for 100 video channels at the outset and upwards of 50 audio channels, allowing more flexibility in packaging and types of service than existing or proposed broadcasting services.

‘The unique proposition that we have compared to dth satellite is that we’ll be offering local signals and interactivity, which have been described by others as the Achilles heel of dth.’

PowerTel applied for an mmds licence in October and plans to broadcast from the CN Tower and other sites in the region.

Boyle says the service will move through the various outlets offered by wireless technology including tv, Internet access, and networks of various sizes and usages, from broad-based networks for video and text services to corporate or ‘municipal area networks’ for training and educational uses. He says the company may also ultimately partner with other wireless spectrum holders like WIC Western International Communications and possibly MaxLink, both lmcs licensees.

‘Recognizing that there is all this bandwidth we plan to use it all,’ he says.

‘We can’t imagine that there will be anything other than a virtual video available. You’ll be taking about 10 to 27 mb bit rates. That kind of speed means people can download a movie in 10 to 15 seconds – that’s as close to video on demand as most of us care to be.’

The company has not announced an equipment supplier or subscription fees, but Boyle says services will be offered that are ‘less expensive than cable,’ and says an Industry Canada-licensed test conducted this summer with Winnipeg’s Broadband Networks proved the system successful in areas with a large number of obstructions by using overlapping coverage provided by multiple transmission sites.

SelectView, which applied for its licence in September 1995, plans to offer a number of service packages, including a 31-channel basic package at the outset, priced at $16.95. A 37-channel, second-tier package, which includes specialties, and a 53-channel package, including pay per view, are planned. Antenna installation is estimated at about $40 to $60, with equipment supplied by Denver-based Decathlon Communications.

Miles Craig, vp of SkyCable, says the service has received over 1,000 orders and feedback has been good. The service, which has a 150-channel capacity, started at three channels and plans an increase to 60, going from two existing head-end locations in Brandon and Elie, Man. to 10 transmission sites throughout the region. Craig says the service will likely be the largest mmds system in terms of area anywhere in the world.

SkyCable, which is supplied by Broadband Networks, offers a basic package for $19.95, three discretionary packages ranging from $6.49 to $9.49 and seven pay-tv packages. A ppv service is planned. Craig says the primary target for SkyCable is the block of 50,000 unserved homes in southern Manitoba and projects about 30,000 subscribers.

Boyle says an accepted estimate puts wireless services at about 15% of the broadcast marketplace over time, with a three-player market including wireless, wireline and dth services.

On the lmcs side, all three players are in full tilt to get services off the ground next year. Price points are being tested. The two national services – CellularVision Canada, backed by wic, and MaxLink Communications in Montreal, owned by Philippe de Gaspe Beaubien, a branch of the Caisse de depot et placement du Quebec, a u.s. manufacturer, and former Power DirecTv honcho J’el Bell – will blanket 66 markets throughout Canada.

The sole regional licence, awarded to Regional Vision in Mississauga, Ont., is majority owned by Canadian Satellite Communications (Cancom), and will serve 127 smaller communities in Ontario.

The goal is the delivery of full duplex T1, data, high-speed access, interactive multimedia and cd-quality audio and video, although commercial broadcasting services (which require a licence from the crtc) won’t be a part of the initial offering and short-term revenue streams will be on the telecommunications services side, says Bill Dunbar, president and ceo of CellularVision.

Although questions remain on the viability of a fully functioning network (one has yet to be established), Dunbar is confident the four years of testing has provided wic with a consumer-ready service. ‘There are no inherent bugs.’

Of the two national services, CellularVision is first out of the gate, with Dunbar already heading up the new Mississauga-based head office and a series of equipment partnerships in place to feed its startup year, which will be a $10 million to $15 million outlay for wic.

On board designing and manufacturing the pieces are Unique Systems, Lockheed Martin, Communications & Power Industries Canada and DEM Allen & Associates.

Unique Systems of Markham, Ont., which has invested more than $2 million in the Calgary test, is designing the transmit antenna and potentially gap-filling transmitters and repeaters to increase CellularVision’s coverage. Lockeed Martin in Ontario is developing the high-speed digital ‘transceiver,’ which receives broadband or analog video and provides bidirectional T1 data necessary for telecommunications/offerings. The transceiver is a 12-by-seven-inch unit that will support data rates above T1.

cpi in Georgetown, Ont., which has been on board in the Calgary test bed for two years, has developed the 28 ghz power amplifier. Winnipeg-based dem’s gold card is its engineering expertise in design and specification of radio frequency transmission systems for broadcasting and communications stations in the low, medium and high frequencies, vhf and uhf, and microwave

For its part, Regional Vision is spreading its rollout over five years, with four partners investing in its distribution. Cancom, its broadcast division already delivering services to 2,600 small cable operators in Canada, owns 49% of Regional Vision. CSL Infrastructure Management holds a 29% stake in the company; Capital Communications cdpq, a subsidiary of La Caisse de depot et de placement du Quebec, owns 20%. Hougen Communications in Whitehorse is a 2% shareholder.

While the three new licensees get their noses off the ground, there are plenty of other wireless-wannabees in the wings. In the last round of lmcs applications, 10 pitches were denied, including DCM Dialogue Canada Multimedia, a consortium backed by a group of companies led by BCE Mobile Communications.

According to Industry Minister John Manley, four more blocks of lmcs licences will be issued in a few years at which point the Stentor group of telcos may apply (they were excluded this round). Depending on the licence conditions still to come for the lmcs licensees and the outcome of the broadcast distribution regulations in process at the crtc, the telcos may not have to wait quietly. Dissension mounted in the cable ranks in November as wic went public with the possibility that it may allow bce to buy into CellularVision, the proverbial thin edge of the wedge for bce’s entry into the broadcasting business and perhaps setting the stage for a buyout of wic by bce.

Others beside Ron Osborne and company (already with 10 million telephone customers in Quebec and Ontario, revenues of $12.8 billion in the first half of 1996, and profit of $479 million in the same period) looking to get into the wired world, include Rogers Communications, Shaw Communications, Groupe Videotron, BC Telecom, Fundy Cable and Bruncor in New Brunswick, and Telus Corporation in Edmonton.